92% of Colombians have payment applications, but 53% abandon them

On the eve of the end of year season, when purchases skyrocket and the use of digital payment methods reaches its highest levels, the second edition of the study Trends in Payment Methods in Latin America 2024, prepared by Ipsos, a market research, reveals findings on how the region is adopting new methods of conducting transactions and payment dynamics in 14 Latin American countries, showing a landscape of growing financial inclusion, but with significant challenges that persist.

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The report highlights that, on average, Each Latin American user handles 5.2 payment methods, which reflects significant diversity. Although cash remains king in the region, its use has decreased steadily over the past five years, while digital transactions tripled in the same period.

In Colombia, 92% of users have at least one payment application installed on their cell phone, exceeding the average for the region. However, there are several challenges, including their permanence and use: a surprising 53% of people who download these applications stop using them, showing a high abandonment rate that developers will need to address.

Chile, on the other hand, leads the Financial Inclusion Index (IIF), followed by Panama and Argentina, while Colombia occupies fifth place. This index, also prepared by Ipsos, measures the access, use and quality of financial servicesand despite overall progress, access and use dimensions still present challenges in much of the region.

Among the most shocking data in the report is that 73% of Colombians still prefer cash as their main means of payment, and 44% make multiple cash payments daily. This contrasts with the global trend of reducing dependence on cash, suggesting that economic informality remains an important factor in the country.

In comparative terms, Brazil stands out as a leader in the adoption of digital accounts, while in Chile and Mexico debit cards are predominant. However, across the region, fear of fraud remains a major obstacle. In Colombia, more than half of those surveyed claim to have received fraudulent messages or callswhich weakens trust in digital financial services.

Another key figure is the growth of e-commerce driven by digital means. While in 2021 only a fraction used payment applications for online purchases, today it is common for Colombians to make transfers and payments from their mobile devices. The end of year season, with its high demand, is projected as a critical moment to consolidate this trend.

The report suggests that trust is a decisive factor. Users of savings and credit products show greater trust in financial institutions than those who do not use them. This data highlights the need to educate consumers and reinforce the security of digital platforms to encourage their sustained adoption.

The challenge for the region is not only to promote banking and the use of digital media, but also to guarantee a safe and reliable experience. Banks and fintechs face the task of designing strategies that reduce defection and increase loyalty.

The panorama of payment methods in Latin America shows a trend towards digitalization that progresses constantly, but requires overcoming cultural and trust barriers. With year-end shopping around the corner, payment platforms have a golden opportunity to consolidate their role in regional economies.

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